||The Communists of India and
By Rakesh Wadhwa
The Himalayan Times on Monday, June 13, 2005
||What is happening in Kolkata is enough to make Marx and
Lenin turn in their graves. The Indian communists of West Bengal have given
up their ideology and are going out of their way to attract capital – Indian
Kolkata boasts of India’s largest Pizza Hut outlet, as well as highest
selling Sony World franchisee. As if these symbols of capitalism were not
enough of a reminder of a changed world, Manabendra Mukherjee, minister of
IT, in the state’s communist government can look at Westside and Pantaloon
malls on Camac Street from his office.
Bengal, a bastion of India’s communist rulers for 29 years, is witnessing a
sea change. The communists remain in power but their philosophy could not be
more different. They have embraced pro-market reforms with a vengeance – as
if to make up for all their failed policies in double quick time.
Bengal’s government encouraged Pepsi to set up its potato processing plant
in the state. Currently the company is doubling its 80 crore investment. The
state has now become India’s second largest grower of potatoes. Dabur too
has set up a fruit processing plant. Moreover, four companies from France
have shown interest in investing in food processing. The communist Chief
Minister, Buddhadeb Bhattacharya’s, avowed intention is to obtain investment
and he doesn’t care whether it is Indian or foreign.
Though Bengal was always India’s top rice producer, it has now become No.1
in producing vegetables and pineapples as well. This has happened because,
unlike in the erstwhile Soviet Russia, farms in Bengal are privately owned
and whatever the tillers produce they keep.
No wonder Bengal has stunned India with its growth rates, and turnaround in
industrial and agricultural development. In the last decade its economy grew
by over 7% a year, while even Karnataka – the state which has Bangalore as
its pride – could only manage a 6.4% yearly increase in its domestic
product. Gujarat at 6.1%, and Haryana at 5.8% were way behind.
This growth has been led by Rs.27,000 crore of private industrial investment
flowing into the state in the last 13 years. This investment was higher than
in Maharastra, and second only to that in Gujarat.
The communists now woo private capital as if their lives depended on it. The
investment in iron and steel projects is in hundreds of crores. Kolkata
exports, from minister Mukherjee’s favourite IT complex, software and BPO
services valued at Rs.1,400 crores. What is happening in India’s Bengal is
no different than what is taking place in Lenin’s Russia and Mao’s China.
China, especially, exhibits capitalism. Its pro-market and pro-investment
policies have gone far ahead of India’s in liberating businesses from red
tape and controls. Where as India grew by 6.9% in 2004-05, the figure for
China was 9.5%. If we account for what has happened since 1980, China is
even further ahead. Its average annual growth of 9.5% exceeded India’s 5.7%
by a whopping 3.8% every year.
This extraordinary growth in China has been due to its ability to convince
investors to regard it as the ultimate opportunity for profits. While in
2001-03, China garnered in excess of 10% of the global foreign investment,
India could not even get to the 1% mark.
China has become the world leader in exporting textiles. The success of its
private entrepreneurs sends a chill down the spines of world’s competing
businessmen. In 2004 alone China exported US$ 97 billion worth of textiles.
India could only manage to send abroad textiles valued at US$ 14 billion.
Textiles are not the only success story. China’s manufacturers, across the
board, are bedeviling the world with their newfound aggressiveness in
closing deals. They are hungry for domination in the world markets and are
leaving their competitors in the dust.
It is ironic the way China has jettisoned the teachings of Marx, Lenin, and
Mao. Even more ironic, though, is how, in other countries including Nepal,
communists still cling to their failed ideology. Let the Nepalese communist
parties send their cadres to Bengal, China and Russia. Let them understand
how these places, where communism originated, function. On their return,
they just might influence their leaders into embracing capitalism, markets,
reforms, and hence prosperity.
(The writer an economist and a proponent of free markets contributes to
leading international dailies. Contact e-mail: firstname.lastname@example.org)
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